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At the Publicis Groupe annual shareholders' meeting in Paris, chairman and CEO Maurice Lévy spoke of the "beautiful dream" of the failed merger with Omnicom, and admitted that the experience has aged him.
Talking to about 450 shareholders and other attendees at the Publicis Cinema on the Champs Elysées in the French capital, Mr. Levy also commented on succession plans for the group, now that the merger is off. He said, "Everything has to come to an end, including the most marvelous experiences, and there will come a day when I'm going to have to walk out gracefully. I'm 72 and I'm starting to sag and look the worse for all this, so I have to get ready."
He said that during the merger talks, it looked like part of the succession issue had been solved, but that a "hard and fast" conclusion had not been reached. "It's now going to be up to the supervisory board to go back to that project," Mr. Lévy said. "They will be doing so this fall and it's going to take a little while. No doubt next year they will bounce back with the appropriate solution and I shall be there to help the company for as long as I'm welcome – not necessarily in an operational role."
Elisabeth Badinter, chair of Publicis Groupe's supervisory board and daughter of the company's legendary founder Marcel Bleustein-Blanchet, thanked Mr. Lévy for growing Publicis into a global company and for "preserving the soul and values created by my father" and for the stability of the "ethical and rigorous" management.
Mr. Levy's contract, which has already been extended once, runs through December 15. Today he seemed to indicate that he was willing to stay longer if necessary, perhaps in a less hands-on role, to ensure a smooth succession at the company that has had only two CEOs in its 88-year history--himself and Mr. Bleustein-Blanchet. The 13-person supervisory board Ms. Badinter presides over that will choose his successor includes French business and financial executives, Publicis execs, and Ms. Badinter's son Simon, who lives in the U.S. and was once a radio talk show host there, and her niece Sophie Dulac.
The theme of Publicis Groupe's ethics recurred throughout the question and answer session. Mr. Lévy said of the merger collapse, "It's very simple when you have principles, when you have convictions. We had hoped that over the months the differences between us might become attenuated, but on the contrary, they came more to the fore, so we were confronted with something that would be a very unequal merger, with dilution of the Publicis business model."
Mr. Lévy added, "When we give our word we keep it, so we brought this marriage to an end mutually. Rather bizarrely we divorced before we got married, which is better because you don't have to count the silverware and you don't have to wonder who gets custody. It was all done very elegantly in a satisfying and humane manner."
Mr. Lévy reassured investors that they were "shareholders of a very strong, very powerful group," and promised that, during the talks, Publicis and Omnicom did not "have access to each others' secrets," despite a lot of communication between the two.
However, he admitted that he had learned some things from Omnicom's way of working that he might think of applying at Publicis. And he added, "In general terms [Omnicom does] know how we manage to post better margins than they do. That's one of the reasons why the marriage wasn't consummated – you really have to do a lot of work to achieve those fatter margins… they saw how much it would require and they didn't want to go that far."
Asked how Publicis was affected by WPP CEO Martin Sorrell's outspoken comments against the merger, Mr. Lévy said, "Obviously WPP was going to react because it was going to cost them their number one ranking. They became increasingly sarcastic when they observed that we were not going to be successful in bringing the merger into being, and I must say objectively that it is less than pleasant to hear such remarks. They poked a lot of fun at our inability to bring the deal off. When you try something and it doesn't work, failure makes you even more aggressive. So we set out not to wage a war of words with our English competitor but to engage in a market war – our objective is to gain market and that is ultimately what matters to us."